Major credit card frauds and how to curb them
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Theft of Identity
This is where frauds use other people’s information to conduct a
transaction this fraud can be prevented by asking the customer to
verify their identity.
Phishing this is when a person receives a message to send their
credit card information from frauds. This information may be used
to break the law. To avoid this problem, customers are urged to
confirm the source of any message that asks them for their credit
Page jacking is common on the
internet. This occurs when a person follows a link and is
redirected to a page that is not recognized. It is somehow
challenging to avoid page jacking. This fraud is dangerous as you
may find yourself purchasing a product through a fake site.
Merchants should be careful and ensure that their sites have not
been stolen to minimize this problem.
Fee scams happen when you are asked to provide an advanced
payment and in return you will earn some money. To arm yourself
against this vice, don’t accept these offers.
Check scams come inform of large payments. A customer may be
willing to pay more in advance or even overpay for a product using
checks. Be wary as this may be a scam to get free properties.
Though they are mostly safe due to counterfeit security
measures, some experts have specialized in making fake money
orders. Check carefully for any money order from risky parts to
curb this problem.
To be safe, merchants should avoid conducting business with
companies that have no good history with PCI compliance. This is
usually a major source of data breaches for many companies online.
It is good to do business with trusted people over the internet and
you won’t have any ifs.
Some e-commerce sites found it difficult to prevent fraud in the
early stages of the introduction of e-commerce. This has greatly
been reduced due to the fact that there are fraud detection systems
now available. Below are some of the suspicious behaviours
experienced by many merchants online.
- Fake new customers who use other people details to make a
- Orders that are abnormal- These involve large orders and are
mostly done by new customers.
- Identical orders that are large. When a customer purchases many
items that are similar might be a fraud transaction
- Getting less time shipping of merchandise- This involves
customers using channels that deliver merchandise quicker than
- Using of international shipping addresses- verification of
addresses can only work in the U.S. and U.K. this presents a
possibility of fraudulent shipping of products.
- Making payments using same account numbers in credit cards-
This is where some criminals use software’s to generate account
numbers and use fake numbers to make a purchase and then cease to
use them when they have completed the transaction.
- Having different cargos shipped to many different addresses
using a similar credit card number. Happens when frauds use the
same credit card number and have the products shipped to different
- Many orders from one IP address but with different credit card
numbers. Frauds use the same computer but with different credit
card numbers to order for a merchandise.
Use of Payment Gateways in place of PCI
Sometimes merchants may decide to use payment gateways as a
means of getting PCI compliant without having to undergo the whole
process of getting compliant directly. This in itself brings a lot
of benefits to merchants who are time conscious and want to save
something from the deal. Despite the benefits, there are also some
limitations to using gateways.
Despite the fact that getting PCI DSS compliant can be
overwhelming, merchants are highly advised to do so as this will
make sure that no one has regrets about the decisions they make
while trading online. It is good to note that ‘cheap can be
expensive’ and whatever reason you have in doing something, you
should take extra care.
To begin with, payment gateways protect non compliant
merchant applications. When you are using a PCI compliant gateway,
you may be able to operate with shopping Carts and payment apps
without getting any PCI applications. This is solely because PCI
processor is not able to know any details about the applications
used by merchants. By taking this risk which is eminent in
business, merchants are able to benefit somehow with the process
Although it may seem naïve to add a gateway because of costs
involved, it is becoming increasingly common for merchants to use
gateways as they add the compliance property to their processor
interface. In other terms, gateways tend to reduce costs in the
long run for a merchant.
PCIs tend to confine your payment gateway options into a thin
choice. Given the scope of payment gateway companies, some can
merely afford to get PCI compliant resorting to the use of cheaper
techniques to operate. This may be working through QSAs and as a
result discouraging merchants from using them.
There is a possible loss of control when using other payment
gateways as a means of getting compliant rather than managing a
payment system by themselves. Compliance assessments work to access
whether a merchant is compliant with the PCI DSS. This may be
involving a long process for merchants hiding behind other payment
gateways rather than managing their own payment gateways. Merchants
who have managed to get PCI compliant by themselves tend to argue
that it is easier to take control of their business than when using
a different payment gateway.
Security may be compromised. Although it may seem beneficiary to
work under another payment gateway, it may be highly risky in terms
of security. It is better to get your own payment gateway system
that is PCI compliant. This is because it is easier to monitor and
control all the security of your system.
Just getting PCI compliant does not necessarily mean that you
are safe from fraudulent activities. Many merchants have been
victims of fraud by trying to reduce costs. This is because some
payment gateway companies do not care about the welfare of their
clients and only get to the basics in terms of security. For
instance, they only security measures they have are the common
Address Verification system (AVS) and the Card Code Verification
(CCV). This drastically increases risks as software’s usually
require regular updating and improvements to maintain high security
Payment gateways usually overlook the issue of data security as
a feature and they tend to ignore important details in transactions
that are carried out through their systems. As a result of this,
there are many frauds that go unnoticed in these systems. This may
cause huge losses for innocent merchants who fall victims by only
choosing the wrong payment system.
Whether a merchant uses out-sourcing or in-sourcing payment
gateways in PCI, it is of paramount importance to trade carefully
with what you decide to do about your payment system. Screening all
your options and choices will assist in reducing any derailment in
your part and will act to provide a secure and safe path for your
For retailers doing business online, there are various websites
that train them on how to conduct business online safely and
securely. Basically, the National Retail Federation (NRF) will
guide you on how to be safe online to avoid losses. Any breaches to
data in payment gateways are taken seriously and that is why it is
important to report them to the relevant authorities for
investigations to be carried out to solve the problem. There are
fraud control procedures in place to curb data breaches and ensure
that the online community is safe.
PCIs produce an environment that is conducive for financial
services to be conducted in a safe and secure manner. Getting
acquainted with the PCCI DSS is a good step to start with as it
ensures that all customers’ information is safe.